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ZURICH (Reuters) - The Swiss government expects fewer asylum requests in 2016 than last year, after a clampdown on migrants crossing the Italian border.

Landlocked Switzerland is budgeting for 35,000 asylum requests this year, the Swiss Federal Council said on Friday, down from about 39,500 in 2015 and more than 20 percent less than a previous forecast of 45,000.

With the migrant crisis in its third year, a deal between the European Union and Turkey has reduced numbers of people crossing the sea to Greece, making Switzerland's neighbor Italy the new front line.

In July, more than 25,000 migrants arrived in Italy, 12 percent more than last year, EU border agency Frontex has said.

Despite that, Swiss asylum requests in June, July and August fell by more than a third on last year, according to the Swiss State Secretariat for Migration.

Some two-thirds of the nearly 7,500 migrants who reached Switzerland via the Italian border between July and early August were turned back.

Critics of the clampdown have accused Switzerland of closing its borders, causing a pile-up in northern Italian towns including Como.

But Swiss border officials say the country is merely fulfilling its obligations under Europe's so-called Dublin system for handling refugees, by returning migrants to the first country where they registered.

Switzerland said in June it expected its federal budget deficit to rise to around 600 million Swiss francs ($613 million) next year due to the costs of rising numbers of asylum seekers.

On Friday, the Swiss Federal Council said it was increasing its planned budget spending for 2016 by 107 million francs, or 0.2 percent of the overall budget, mostly to handle asylum seekers.

The outlay would have been higher had the government not reduced its forecast of asylum applications to 35,000, a Finance Ministry spokesman said.